Picking at an old scab

Recall a month or so ago we had a thread about costs for a PM in The US. As usual, it morphed into a general discussion of costs.

My comment about the general costs for anything medical in the US is a fiction - w/ very few exceptions.

I just was cleaning up a bunch of old mail & found a statement from my hosp for a procedure performed on 18 Dec 2014. The procedure was an endoscopic exam of esophagus & stomach. Bill was $7,444. Insurance will pay $1,451. The rest was written off. This was a bill paid by our Medicare system & a supplemental policy that covers co-pays. Bill did not include the surgeon's Costs to do the procedure; this was just for the room, equipment & associated hosp personnel.

What is the real cost? Who knows other than the accountants.

In the same batch of mail I found a statement for the Surgeon's bill for the foot surgery I had last Sept. His charge was $3925. He was paid $797 - about 25% of his billed amount. He is NOT an employee of the Hosp, so out of that $797 he has to pay all his practice expenses. It is no wonder that Dr's are refusing to accept new Medicare patients.

Donr

5 Comments

You are NOT off point.....

by donr - 2015-02-05 01:02:53

.....The bills are a fiction from the moment the accountant sits down to calculate costs to generate a bill.

Some food for thought: Supposing you are facing a murder charge that can bring you the death penalty. Who are you going to hire? The best lawyer in town, who charges $2,000 per hour for his services and has never lost a case (And you can afford it) or Joe Schmuck, who just passed the Bar Exam last week after his third try and has never even tried a case? Reasoning from the absurd, I know, but it illustrates one point. You WANT to use the service provider w/ the best outcome record that you can afford. All surgeons are not equally talented, so some have better success rates than others.

Whenever someone asks about Roto-Rooter jobs for lead removal, what is the first thing we tell them? Go find a surgeon who does 100 per year at least - so he/she is considered proficient. Now that surgeon may charge far more than the one who only does 25 per year, but your chances of survival may well be twice to four times better than w/ the one who does fewer. An example that I became involved in - Bishop Tutu from South Africa came to the US for a procedure. I found this out quire by accident. Turned out to be the same one I was using for the same procedure. That surely gave me a warm, fuzzy feeling about the qualifications of my DR.

You are completely correct about the box of Kleenex (nose tissue, for those not in the US) cost being absolutely irrational. But consider the following: Supposing that the Kleenex was being stored & issued from the same stock room that handled gold coins & that they have the same inventory quantity of both products & use the same computer system to account for both. Now Gold coins take up very little space, while boxes of Kleenex take up huge amounts of space. Overhead costs for buying, handling & storing items are generally based on the numbers of items stored, NOT their relative values. You take the total cost for all the people, space, computers, etc to perform the supply function & divide that by the number of items stored to get the unit cost of the overhead to supply them & supposing it comes out to $27 per item. If the Kleenex cost the hosp $1 to buy, add the internal costs of $27 to the purchase cost & you get $28 showing up on your bill. Supposing that same patient required 1 gold coin, weighing an ounce. You'd get a bill for $1274 + 27 = $1301. You'd think nothing of the gold price, but the Kleenex cost would give you a coniption fit!

Sunny, would I scream about $28 for a box of Kleenex - of course I would, it's way out of line.

You have illustrated my point, exactly - Medical costs are an insane fiction! BTW: Did you know that the pillows they use in most US hosp's are disposable? Yep. You want them, you may have them for the asking. Make great dog pillows when placed in an old pillow slip.

Donr






costs

by Alma Annie - 2015-02-05 06:02:53

Some years ago a business acquaintance was visiting here in Australia from US. She had to have a medical procedure whilst here, though I don't know the nature of it. It was done privately, so her insurance would have to pay. She was billed A$300.00 She raised her eyebrows. The receptionist was concerned and asked if she thought it was too much. "Oh no, if I had this done in the States it would have cost me $3,000.00 The receptionist asked how that could be justified.
enough said!!!

By the way, in 2013 I had an endoscopy and colonoscopy. All I had to pay for was $25.00 excess hospital cost. My private health fund paid ALL the rest.
Alma Annie

Someone Pays. There is no ....

by donr - 2015-02-05 08:02:04

...such thing as a free lunch!

For those who receive healthcare from the government, your tax money pays for it. Someone has to pay for the building, equipment, utilities, support personnel, maintenance, general supplies, medical supplies, ad nauseum. Someone has to pay the MD's - they may be hospital employees, or they may run a private practice, but they get paid if they are going to eat. Someone has to pay to educate them. Government? They pay for their own education? Depends on where you live.

The US has been going through a transition of "Who Pays" ever since about 1942 w/ the advent of health insurance. I pick 1942 because during WW-II (Dec 1941-Sept 1945) in the US, wages were frozen, so to be able to attract workers, employer-paid health insurance was offered. Prior to that period, you paid your own way. Was it expensive? I do not know, I was too young - born in 1936. But there were no high-tech X-rays, labs were "Simple," no MRI's, no CT Scans, Ultrasound, etc. ECG's were only 40 yrs from being a huge salt water bath for your feet & electrodes stuck to your body by gooey adhesives that came off only w/ severe scrubbing. The digital computer was still 10 yrs in the future - maybe. Diagnostic tools essentially consisted of the stethoscope, a mercury thermometer, a crude ECG & an X-Ray machine. A house call by Dr. Plume (our town Dr.) cost all of $5.00, & was more usual than going to his office. There were only 3 childhood immunizations: Smallpox, Diptheria, Tetanus. You got your immunity to measles, mumps, rubella, whooping cough by catching the disease. The only antibiotic was a sulfadrug. Medicine was not too many years out of the witchdoctor era (Sorry, Selwyn - had to exaggerate a bit to get on to the rest of the discussion.)

Come 1945 & technology exploded! All sorts of neat devices were quickly developed - transistors, digital computers, smaller, more convenient, more precise & accurate ECG's - all the diagnostics we have today. ALong w/ the diagnostics, came modern meds that did wonderous things. But it all came w/ a cost - monetary & sociological. Someone had to pay for it all - & in most cases, the costs were astronomical. Enter socialized medicine. The US version of it was Medicare, birthed in about 1965 under President Lyndon Johnson to help those over 65. (The retirement age in the US) Still not full-fledged Socialized medicine, but essentially Govt insurance, w/ a co-pay & a deductible.

Suddenly, you did not just go for treatment & negotiate a cost w/ your provider. YOu had an insurance company (or the Govt) who did it for you. And, everyone of those cost-paying entities swung a different deal w/ them. That leads us to today w/ the most screwed up cost system known to mankind!

I had two procedures dome at the end of Dec 2014. One by a hosp employee surgeon & the other by a private practice surgeon. Each is costed differently because of the way it was billed. I'll let you look at each & decide what the real cost is for each procedure.

Procedure 1 - a series of pain killing meds injected into my back at 8 locations near the spine. Took 45 minutes. Involved the surgeon; an RN assistant (NOT an MD); an X-Ray tech to operate a special fluoroscope so the surgeon could place the needles for the injections; a nurse to prep me & record all the data needed. Billed: $2,000. Paid: $531.26. That paid for 4 people, all the equipment, the building, its maintenance and operating expenses.

Procedure 2 - The endoscope. Took about 45 minutes. Surgeon looked at my alimentary canal from the entrance to the small intestines back up to the junction with the airway at the base of the throat.This involved the surgeon; an anesthesiologist; a tech to operate the endoscope & an RN assistant. Preceeded by an RN to prep &install an IV & another RN to monitor me after the procedure while I woke up; Follow up pathology & lab work.

Billed: Hospital: $7,744. Paid: $1452.25. covered all but the anesthesiologist & Surgeon (1 Tech, 3 RN's + lab people)
Billed: Surgeon: $1,045. Paid: $182.56 He has to cover ALL his expenses since he is self-employed: Office rent, utilities, 6 employee, his mal-practice insurance.
Billed: Anesthesiologist: $805. Paid: $140. Covered two people - 1 MD anesthesiologist & 1 RN anesthetist. Their expenses are the same categories as the surgeon above.

IMHO, none of the organizations or professionals involved are paid enough to cover all their expenses.

Guess who pays the difference - smaller insurance companies who do not have the power of the gun that is figuratively placed at the provider's heads by the Govt Medicare that pays whatever it wants w/o regard to real costs.

This crappy system is going to shake itself out in the next couple years & it's not going to be pretty.

Donr

Health costs

by TickTock-UK - 2015-02-06 05:02:26

Hi All,

Looking at the cost of treatment you have to pay in the US to me looks scandalous, they are taking you to the cleaners, or the insurance companies...You can get a box of tissues here for 50p...I am so glad to live here in the UK and not have to worry about cost of any surgery when needed..I know we pay every week in our National health costs I would rather do that than have to worry about health insurance...(probably why everyone wants to come and live here it's not for the weather that's for sure.)

Len

Len ummed it up quite...

by donr - 2015-02-06 09:02:26

....nicely. It's how you want to pay for it. He prefers to pay for health care on a weekly basis, whether he needs it or not at that point in time.

I prefer to pay for it as I need it.

But I fall into a special category, being an Army retiree after 28 + years of service. I essentially paid for my current healthcare over that 28 years. Most of it at a salary considerably less than I could have made in the civilian world. At the callow age of 22, you do not think much about how things will be after you retire some 28 yrs later - if you live that long, it is so fuzzy & unclear. But at 22 you are going to live forever; you are indestructible. Ah, those were the days, my friend, you thought they'd never end, you'd sing and dance forever and a day, we'd live the the life we choose, we'd fight & never loose, those were the days, my friend, those were the days!

Right now, roughly 16% of the US economy is healthcare. It uses somewhere near 5686 hospitals of all sorts to take care of us - ranging from the monstrous facilities in major cities w/ multi-hundreds of beds down to the small, rural, county-owned hospitals with only ten or so beds. Just the costs of running these facilities adds up to $8.6 Billion per year. Of course, they serve some 320 + million people, so there are going to be a lot of them & they will cost a lot of money.

I don't know how much I can buy a box of tissues for, but it's approximately $1 - but throw it into a bureaucratic system that has wicked overheads just because it exists & the cost becomes astronomical. MOF, the cheaper an item is on the open market, the more the accounting overheads bloat its cost, as I pointed out comparing the relative costs of tissues & gold coins in the same system.

Len is correct on another point - no one lives in the UK because of its wonderful weather. That's why they go to such places as the Med, Sunny Spain, the Azores, Orlando, etc for holiday. We lived out in Ian's neck of the woods in Bucks for 18 months & will testify as to the veracity of Len's weather appraisal.

But - OTOH, I would not live where I live in the US because of its weather. It's hot in summer, w/ a humidity to match the temp; it's miserably miserable in winter, unable to decide whether it's gonna be warm (60 degrees F) or cols (23 Deg F) like last night. Whether it's gonna rain or be sunny. So why do we live here? Too long a story, but it is economics, mostly. Base my choices on medical care, I'd choose the US. But that's why both countries have citizens & always will.

Donr

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